This test launch was never planned to actually make orbit. It was an "orbital test flight" only in the sense that it was intended to demonstrate system performance that would basically have been enough to reach orbit; the original plan was that they'd reach velocities and aerodynamic stresses similar to an actual orbital flight, test stage seperation, both stages, and part of the re-entry, then crash into the ocean, all on a sub-orbital trajectory. Something apparently went wrong at stage seperation.